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Judgment
On an application u/s 256(2), the Tribunal was directed to refer the following question for the opinion of this court :
"Whether, on the facts and in the circumstances of the case and in law, the Tribunal was justified in cancelling the penalty imposed u/s 273(2)(a) of Rs. 46,416 notwithstanding the fact that R.A. u/s 256(2) of the Income Tax Act, 1961 before the Hon''ble High Court on the quantum issue has been filed and the decision of which is pending ?"
In pursuance of the direction, the Tribunal has referred the aforesaid question for the opinion of this court. At the outset, learned counsel for the assessee submits that in the quantum of appeal, the entire addition has been deleted, therefore, no base remains for sustaining the penalty.
Learned counsel for the department prays for time to verify this fact 5 /6 opportunities were given and the reference was adjourned, but he has failed to controvert the facts submitted by the learned counsel for the assessee.
Considering his submissions, when the entire addition has been deleted in the quantum of appeal, no reason survives for sustaining the penalty on interfere in the order of the Tribunal.
In the result we answer the question in affirmative, i.e., in favour of the assessee and against the department.
The reference so made, stands disposed of accordingly.